Market Next


February 19
14:55 2017

Sensex and Nifty closed positively on Friday, especially Sensex which hits 5 month high.  One interesting point to be noted here is that on Friday private sector banks (especially HDFC Bank) supported the market.   HDFC Bank which made a new 52 week high on Friday after RBI withdraws ban limit.  Rest of the sector were remained weak.  Going forward market tend to remain in a narrow range between 8965-8715, a break above or below can give a direction to the market.  BMC election on 21st February and holiday on Friday may restrict investors from creating big open positions.

The daily charts are on the sell side, but weekly and monthly charts are still on the buy side will give investors an opportunity to enter at lower levels for medium term to long term.  Falling India VIX is also a good sign which ended at 13.34 on Friday. The latest concerns are raising VIX of S&P 500, which rose above 10 and Federal Reserve’s intension to increase interest rates as soon as next month.  If there is a rate hike in US then we can expect heavy sell-off in the equity markets and commodity markets.

Bank Nifty gained extensively last week will face resistance at 21001, and it may get support at 20381 and 20068.  Banking Nifty charts are also suggesting overbought situations.  So it is prudent to create small open trading positions next week.  Nifty IT index is also overbought; we saw profit booking on Friday due to overbought situation. It is very difficult for the IT index to move above 10647 and it has strong supports at 10453 and 10326.  On the daily charts of the Nifty Metal Index already entered in to the oversold situation, so one can expect marginal buying interest.

Ambuja Cements, KSB pumps, Castrol India and Merck are the few companies which will announce the quarterly earnings, with these results Q3 earning seasons will come to an end.  The major events can affect the market in a big way are state election results and roll out of GST apart from the US interest rate hike.

US initial jobless claims, continuing jobless claims are due from US.  From the Euro zone analyst are keen to have cues on Balance of trade, unemployment rate, inflation rate, GDP growth rate and Industrial production.  From the domestic front Foreign Reserves, GDP growth rate and Industrial Production data’s are expected next week.

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